Hastings Borough Council Set To Sign Off On Long-Delayed Final Accounts

Hastings Borough Council is about a week or so away from signing off on its long-delayed final accounts for 2019/20, councillors have heard.

The matter was discussed at a meeting of the council’s audit committee on Thursday (July 29), where councillors had been due to consider the final report of external auditor Grant Thornton. 

The report would mark the final step in the external audit process, which the council needs to complete before it can fully sign off on its final accounts for the 2019/20 financial year. 

At the meeting, however, the council’s assistant director responsible for finance Peter Grace told the committee that the external auditor had not yet completed the work.

He said:

“We are probably a week to ten days away from having them complete their review. [That is] for a whole multitude of factors, not least because they lost their whole audit team. 

“As a result of that, they have had to redo a lot of the testing that they undertook originally and as such they’ve raised more queries, which we are still answering, some of which we answered previously. 

“There are no material items that they advise, so as per the March decision the delegated authority to sign these off will remain with [audit committee chairman] Cllr [John] Rankin and myself to agree any amendments in the final report. 

“We don’t need another audit committee unless there are material changes to those accounts. They haven’t found anything to date. There are a few days left, but they are not expecting to find anything at all.”

While work on the external audit now appears to be drawing to a close, the council is still a long way past the deadline for publishing its final and fully audited accounts for the 2019/20 year.

Initially the council (and other authorities) had been required to publish these accounts in July 2020, although the government pushed this national deadline to November 2020 in light of the impact of the Covid-19 pandemic.

Even so many councils have yet to meet this date.

Mr Grace said:

“It is a long time back and we are working on closing the 2020/21 accounts at the moment. 

“We are also in the 2021/22 financial year and the poor accountants are struggling with queries not only for 19/20 still, but also the 2020/21 close down and of course trying to get all the information out for 21/22. 

“It is quite a confusing position and not a satisfactory one from our point of view at all. 

“To close down the accounts for the latest year – 20/21 – we clearly need definitive close down positions on our reserves and our accounts and we are not sure of those positions until we close those accounts down.”

Mr Grace went on to say he was not confident the council would be able to publish the fully audited 20/21 accounts by the September deadline set by the government.

He said the delays with the external audit could also impact on the council’s budgeting work as officers’ time would be split.  

But Hastings Borough Council is far from the only council facing issues with its external audit process at the moment. 

According to a recent report by the National Audit Office (NAO), only 45 per cent of local authorities were able to publish audited accounts by the 2019/20 statutory deadline. This was down from 57 per cent in 18/19 and 87 per cent in 17/18.

Some councils are even still waiting for audit opinions for 2018/19.

Issues with the local authority audits were recently examined as part of an independent inquiry commissioned by the government.

Published last year, the Redmond Review concluded that the local authority audit system is under strain and not performing as well as it could.

One key recommendation from the review was to increase the fees which accounting firms can charge for public sector audits. This, the review said, would ensure the firms had sufficient resources to carry out their work and could attract new firms to the sector.